Twenty years after a brutal civil war that left one million people dead and five million displaced, more than half of Mozambique’s people still live below the poverty line. The recent macro-economic growth in Mozambique has not been inclusive, and the promise of broad-based, private-sector-led economic and social development is not being realized. The vast majority of Mozambicans work in subsistence agriculture and in informal or non-competitive, low skilled services sectors. With limited formal-sector jobs on offer, the 9-million-strong labor force is growing rapidly as the country’s young population (45% are under 15) matures and those benefitting from expanded access to secondary education seek employment.

The Mozambican labor force is expected to increase by more than 300,000 per year, to 15 million in 2030 and 20 million in 2040. This calls for effective strategies that would ensure that the private sector is geared to absorb this human capital as it comes into the marketplace.

Products & Services

Business Verification

Training

Credit Advisory

Credit Facilitation

Market Research

While economic growth has increased significantly in recent years in Mozambique, it has largely been driven by natural resource ‘mega-projects’ that make limited use of the domestic marketplace, and therefore have not had an impact on poverty reduction. At the same time, SMEs, which create 86% of jobs in developing economies, lack access to formal credit, which has greatly inhibited their ability to compete for opportunities emerging in the Mozambican market. In 2013, Building Markets launched its A2F program to provide a crucial linkage between local firms and providers of finance.

Bringing Visibility to Local Firms and Markets

Building Markets has built a network of over 800 SMEs in the country, 53% of which are owned or managed by women. This information helps connect local businesses to new opportunities, identifies trends and challenges, and informs the design and development of services and partnerships:

Hosted regular information and networking events to create an opportunity for SMEs to meet with banks, government officials, and other stakeholders in SME finance;

Partnered with 8 banks in Mozambique to advocate for the creation of products and services that will bridge the gap in access to finance for SMEs;

Researched and published the Demand and Opportunity Assessment and Analysis of business linkages in Mozambique;

Helped SMEs access $12.5 million USD in new credit.

Building Capacity

Building Markets provides training to SMEs to enhance their management capacity in areas such as business planning, customer service, marketing, financial management, record keeping, and procurement. Credit advisory services are also offered to help SMEs through the loan application cycle.

Over 500 SME attended a training session during the program. Finance training courses have also been attended by bank staff looking to increase their technical knowledge;

All training sessions include modules with information about gender equality and environmental sustainability;

Specific credit advisory services include preparation of credit motivations, performing independent monitoring of borrowers to ensure compliance, and providing on-going advisory through life of the loan.

Connecting Local SMEs to Financial Services

Through our local and international partnerships, Building Markets arranges and puts in place financial instruments, such as credit guarantees, that improve the risk profile of qualifying businesses: